China becomes world's second-largest luxury market

14:20, May 06, 2011      

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China overtook Japan as the world's second largest luxury goods market in 2010, according to the "Luxury Goods Worldwide Market Study" recently released by the world's leading consulting firm Bain & Company and an association of Italian luxury product producers.

The luxury goods market has completely recovered from the international financial crisis and the total sales value of luxury goods worldwide stood at 172 billion euros (around 250 billion U.S. dollars) in 2010, exceeding Bain & Company's prediction in October 2010 of 168 billion euros.

Global luxury goods sales are expected to reach 185 billion euros in 2011

The luxury goods sales value set a new record in 2010, reaching 172 billion euros (around 250 billion U.S. dollars). This topped the peak sales value before the international financial crisis and is 12 percent higher than the sales value of 153 billion euros in 2009. Luxury goods consumption will be fully restored and maintain its fast growth in 2011.

Luxury brands LVMH, Burberry, PPR and TOD have all posted better-than-expected sales since the start of 2011. LVMH group, with various luxury brands such as Louis Vuitton, recorded a 17 percent increase in sales, with their sales volume for all categories of goods, including fashion, leather goods, watches and jewelry, on the rise.

Bain & Company has accordingly raised its estimate of the luxury goods sales growth rate in 2011 to 8 percent. The global luxury goods sales value will reach 185 euros in 2011, topping the sales of 172 billion euros in 2010 and setting a new record.

China becomes world's second largest buyer of luxury goods

According to the report, if the Chinese people's overseas spending on luxury goods is counted, China has already overtaken Japan as the second largest luxury goods consumer in the world, only after the United States. Chinese spent 16 billion euros on duty-free luxury items in airports and on flights in 2010, indicating that more and more Chinese are ready to enjoy luxury travel.

The report found that luxury sales in the United States, Europe, and Asia grew 12 percent, 6 percent, and 22 percent, respectively, in 2010, with the sales on the Chinese mainland rising 30 percent. Bain & Company forecasted that luxury sales in North and South America are set to grow 8 percent in 2011, while Japan will see luxury sales fall 5 percent. Luxury sales on the Chinese mainland are expected to grow 25 percent at constant currencies this year to 11.5 billion euros, faster than any other luxury goods market in the world.

The report also noted that India's lack of retail space and preference for traditional dress and homemade jewelry made it tough for European luxury brands to penetrate.

By People's Daily Online

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